Category Archives: Distribution

Having great technology for your product is a given. The new product needs to be faster-better-cheaper that the competitions. Identifying your target customer set and matching their needs is a requirement. All set, right?

How do you plan to get the product from you to them? Increasingly in the technology market you will probably use some sort of intermediary or distribution arrangement. They can be called distributors, dealers, resellers or retailers, but they will probably be the path of choice to market for a technology based product. Now the question becomes how to target, attract and recruit these channels, and once you have them, how do you retain them and help keep the competition out of them.

The creation of a strong and vital Dealer/Distributor “Advisory Board” can be a solution. Utilize the advisory board to help you solve the issues of problem identification, prioritization and resolution. However expect not only “product” issues, but also “process” issues to be identified. One of the goals for this group should be to help identify how this indirect sales force wants to do business, and be dealt with.

As with internal business teams, where you listen to and work with all business disciplines to create a cohesive solution, the advisory board enables you to extend this “teaming” arrangement outward to the indirect sales channel. Their involvement creates ownership and buy-in on issue identification, prioritization and resolution. As the business responds and adapts to their requests and requirements, their commitment to the business should also strengthen and grow, as should their orders on it. It is essential that the appropriate resources and management commitments are provided to see the process through to conclusion. If your sales channels are going to commit their time and resources to work with you they will need to see the same level of commitment from you, or they will look for other suppliers who will provide the commitment they are expecting.

Targeting the proper indirect sales channels can be the most important decision that you can make. There are several factors that need to be taken into consideration:

Who are the products’ target customers and who do they buy them from? Consumers usually buy from retail outlets. Small and Medium Businesses (SMBs) usually buy from a variety of sources (web, small dealers, value added resellers (VARs), etc.). Enterprises and large business usually buy from large distributors and dealers.

What size business are you? Normally equipment providers and distribution channels have a tendency to “peer”. That means larger product providers tend to work with larger dealers and distributors, and smaller product providers work with smaller dealers and VARs.

What is the status and age of the product market? If it is a mature market that is being addressed it will mean competing against existing products for mind share and shelf space with entrenched channels. There will be barriers and expenses associated with displacing the existing product suppliers from the channels. If it is a new or developing market there should be no entrenched products or channels and lower expenses and barriers to channel acquisition.

These are just a few of the topics to consider when looking a selecting specific paths and channels to market. There are obviously many more. What it does point out is that there are relationships between the product and the market that are not related to its technology that will have an effect on its success.